President-elect Donald Trump has announced plans to impose a 25% tariff on all products imported from Canada and Mexico as one of his first actions after assuming office on January 20. The proposal, he said, is aimed at addressing illegal immigration and the drug crisis at the U.S. borders.
In a post on his Truth Social platform on Monday, Trump stated that the tariffs would remain in place until the borders with Canada and Mexico are secured to prevent the entry of illegal immigrants and drugs. “As everyone is aware, thousands of people are pouring through Mexico and Canada, bringing Crime and Drugs at levels never seen before," he was quoted as saying by Associated Press.
He added, “On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders.”
Trump claimed the tariffs would serve as a measure to pressure both neighbouring countries to take stricter actions to halt the inflow of drugs like fentanyl and curb illegal migration. He stated, “Both Mexico and Canada have the absolute right and power to easily solve this long-simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”
These comments have drawn mixed reactions, with some viewing them as a negotiating tactic. Scott Bessent, Trump’s nominee for treasury secretary, recently emphasized that tariffs can be used effectively as leverage in foreign policy negotiations. “Tariffs are a useful tool for achieving the president’s foreign policy objectives,” Bessent said in a Fox News op-ed, Associated Press reported.
If enacted, the tariffs could significantly disrupt trade with Canada and Mexico, two of the United States' largest trading partners. Economists warn that such a move could lead to price hikes on essential goods, from automobiles to agricultural products.
Canada and Mexico have yet to officially respond to Trump’s statements. However, Canadian officials, speaking on condition of anonymity, have expressed concerns over the economic impact of these tariffs. During Trump’s first term, similar trade threats over the North American Free Trade Agreement (NAFTA) raised alarm across Canadian industries.
China was also targeted in Trump’s statement. He indicated plans to impose an additional 10% tariff on Chinese goods, accusing the country of failing to curb fentanyl trafficking into the U.S. China has failed to crack down on exports of precursors used by traffickers to manufacture illicit fentanyl, inaction that has cost the U.S. trillions of dollars in lost productivity, Reuters reported.
Trump's claims come as U.S. Border Patrol data shows mixed trends. While arrests at the southern border remain near four-year lows, apprehensions at the northern border with Canada have increased significantly in recent years. The rise includes thousands of Indian migrants attempting to cross illegally.
Trump’s strong rhetoric is consistent with his broader promise to tackle illegal immigration aggressively. However, critics argue that his statements exaggerate the severity of border issues.
Last week, Bloomberg reported that Trump’s comments triggered market reactions, with the Canadian dollar weakening and the Mexican peso losing over 1% against the U.S. dollar.
(With Inputs from agencies)
